Popular Stories

Mayor Michael Nutter attempts to delivers his budget address to city council at City Hall, Thursday, March 14, 2013, in Philadelphia. Deafening protests have forced Philadelphia Mayor Michael Nutter to abandon his traditional budget address in mid-speech. (AP Photo/Matt Rourke)

Inquirer City Hall Staff

Mayor Nutter entered Council chambers today to give his budget address, setting off a deafening response of whistles and chants from a packed house of angry municipal workers – then he proceeded to read the speech despite being drowned out.

Gallery:

Council President Darrell L. Clarke tried to restore order, and then appeared to call a recess, as the union members chanted, “No contract, no peace.”

Clarke and Nutter huddled briefly, and then Nutter resumed reading the speech, louder this time, though still inaudible.

The mayor’s senior staff and members of Clarke’s staff huddled until mayoral chief of staff Everett Gillison nodded toward Nutter. The two talked and Nutter left the chamber.

The union members chanted, “Hey, hey, goodbye.”

Clarke later officially recessed the meeting until "the call of the chair," meaning at his discretion. The union members, upset at working four years without a contract, chanted, "We won't go."

Councilman Bill Green, one of the few members remaining in the chamber, said he didn't think the meeting should have been recessed.

"This is outrageous," he said. "Michael Nutter is the mayor of the city of Philadelphia. I don't care what you think of him, you have to give the office respect."

Meanwhile, former Mayor John Street, who attends every budget address with students from a class he teaches at Temple, stood in the well of the chamber, answering reporters' questions. Street, who used to battle bitterly with Nutter, said he wasn't surprised at the reaction and said the city's labor situation was "untenable."

A short time later, Nutter completed his speech in the mayor's reception room on the second floor of City Hall.

At the top of the speech, Nutter said he had "the deepest respect" for the city's workers and wanted to reach multi-year contracts with all the unions. But he also repeated his long-held position that the contracts must include pension and work rule changes the unions revile.

After finally finishing the speech, Nutter said he never felt in any danger during the raucous scene, and said he would have continued if Council hadn't gone into recess. He said he only left because he was following Council's lead.

"I'm a guest...It's their house," he said. "It's not for me to opine on what should have been done. I'm there to give a speech."

Clarke later said that he had long respected the executive branch's authority to negotiate contracts, but said he would be getting involved to try to mediate between the two sides after "this impasse has spilled into Council chambers in a very aggressive way."

He called the contract negotiations "a very, very solvable problem."

Clarke also said he never considered attempting to clear the chamber so the mayor could continue because union members had indicated they were willing to be arrested.

"If we attempted to do that I believe we would still be over there," he said.

Here are the details of the budget as explained in today’s Inquirer story:

Mayor Nutter intends to propose a $15,000 tax exemption for homeowners and $30 million more in other property tax relief in his budget address to Philadelphia City Council on Thursday, according to numerous sources familiar with the administration's plans.

The resulting tax rate then would have to be 1.32 percent to collect the same amount of property tax revenue in the next fiscal year as this year - $1.2 billion.

That tax rate translates into $1,320 per $100,000 of assessed value. The homestead exemption would let homeowners deduct $15,000 from the value of their primary residences before applying the tax rate.

The $30 million would be directed toward longtime homeowners living in areas with fast-growing property values, as well as owners of small commercial properties facing higher property and Use and Occupancy taxes.

The rates and relief measures are part of Nutter's property tax reform effort, the Actual Value Initiative (AVI), which figures to be the focal point of this year's budget season.

Overall, Nutter plans to propose a $3.75 billion budget, a $99 million increase from last year, sources said. Only about $18 million of that figure would be for new spending. The rest would go toward increases in wages, pension payments, and other areas.

The budget assumes a 3 percent increase in tax revenues and more than $13 million in savings through efficiencies.

The budget also includes nearly $14 million in new labor costs for workers represented by AFSCME District Councils 33 and 47, as well as firefighters and medics represented by Fire Fighters Local 22.

Those costs are related to contract offers to D.C. 33 and D.C. 47, as well as a future offer to Local 22. All three unions have been working without contracts since 2009.

Given relations with the unions - their members are expected to raucously protest Nutter during his speech - the assumption of labor deals could be optimistic.

The 6,800 blue-collar workers in D.C. 33 who would be covered by the contract soundly rejected Nutter's last offer. The mayor has asked the state Supreme Court to hear his argument for imposing terms on the union.

The administration and firefighters also are entering into negotiations on a new contract without ever resolving the last four-year deal.

The administration is seeking to overturn the latest arbitration award to firefighters, which would have settled the previous dispute.

The new budget does not include money to pay that award, which the administration says would cost more than $200 million over five years. Firefighters have described that number as an exaggeration.

The new budget does anticipate healthy fund balances - $128 million for the current fiscal year and $80 million for the next, according to sources. That could provide flexibility with contracts.

The administration previously said the property tax rate under AVI would have to be 1.25 percent without any relief measures. When breaks are given to certain groups of property owners, the overall rate must rise to pay for those breaks.

Several Council members have argued for the lowest rate possible - Bill Green has proposed eliminating the homestead exemption, for example, to keep the rate about 1.25 percent.

Under AVI, large commercial properties, which have been overtaxed for years, are getting enormous reductions. Their burden would be borne by homeowners instead.

Other factions in Council are arguing for the highest possible exemption - the members passed a bill last year setting the homestead at $30,000 - to push some of the burden back to commercial, industrial, and other properties.